Ugandan crowdfunding platform GoBigHub is helping small businesses fulfil their orders by filling gaping financing gaps through the power of the crowd.
“Many people across Uganda win contracts but lack the capital to fulfil the orders,” GoBigHub founder Ojijo Pascal told Disrupt Africa.
“GoBigHub enables entrepreneurs to access financing on a profit share, no-collateral basis from individual investors seeking above market returns, averaging five per cent per month.”
Simply put, entrepreneurs that have won contracts register on the site or via the startup’s mobile app, and share the contracts. Once the legitimacy of the contract is confirmed, it is uploaded to GoBigHub, where users are able to invest and receive flat rate returns.
“We in turn ensure the contract is executed, by supervising and making all payments direct to suppliers,” said Pascal.
In three years, GoBigHub has facilitated transactions worth a total of US$240,000, and it is now integrating blockchain technology to help financiers see how their funds are utilised to finance projects.
Pascal said Ugandan businesses worked hard to secure contracts, but often lacked necessary capital to complete contracted work, either due to lack of security or mandatory three-years-in-business rules that prevent them from taking loans. GoBigHub is filling that financing gap using the power of the crowd.
Turnover has been increasing year-on-year, while return on investment for investors is also rising. In all, 78 customers have secured financing via the platform, creating around 250 jobs. The startup is still only active in Uganda, but planning to expand.
Blockchain technology, Pascal said, would make GoBigHub even more effective.
“Most investors want to see exactly what their money does, and until we came across blockchain we did not know how to do this. We are now integrating blockchain, and creating a marketplace where our token, KontraktKoin, can be purchased by investors, and used to finance contracts, as well as to pay suppliers on the platform,” he said.